* Euro rebounds against U.S. dollar on ECB speculation
* Global stocks rise on signs of stronger economic growth
* Oil prices gain after raft of upbeat economic data
(Adds close of European markets)
By Herbert Lash
NEW YORK, Dec 2 (Reuters) - The euro rebounded against the
U.S. dollar on Thursday and global stocks gained amid a recent
raft of upbeat economic data and on speculation the European
Central Bank had boosted its buying of sovereign debt.
Investors were disappointed by the lack of a more
aggressive policy response by the ECB to the debt crisis after
its monthly meeting, but the euro <EUR=> rose on reports the
bank was buying Portuguese and Irish debt.
Traders reported ECB purchases triggered a drop in the
premium investors demand to buy Portuguese and Irish bonds over
German benchmarks. They said the ECB had been buying the two
countries' debt at a modestly higher rate recently. []
[]
President Jean-Claude Trichet said the ECB decided to
conduct three-month liquidity operations in January, February
and March "with full allotment." Until recently the central
bank had been expected to phase out unlimited liquidity
measures.
The ECB kept interest rates on hold at 1.0 percent as
expected and extended its liquidity safety net for vulnerable
euro zone banks, promising to provide unlimited weekly, monthly
and three-month funding until at least April.
European equities hit a two-week closing high after falling
on news of weaker-than-expected U.S. jobless claims data.
Analysts stayed positive on the equity market's outlook.
The FTSEurofirst 300 <> index of top European shares
finished up 1.6 percent at 1,106.18 points, its highest close
since Nov. 18.
The ECB "basically said we will do what it takes and while
you can never know what a band-aid will look like at any point
in time, I think the overall theme is that those band-aids will
be found," said Bob Doll, chief equity strategist for
fundamental equities at BlackRock Inc <BLK.N>.
Data for pending U.S. home sales showed an unexpected jump
in October and higher-than-expected sales by U.S. retailers in
November boosted investor sentiment.
Also, Goldman Sachs Group Inc <GS.N> said U.S. banks are on
stronger footing due to an improving economy, higher equity
prices and a favorable interest rate environment.
[]
The Dow Jones industrial average <> was up 101.90
points, or 0.91 percent, at 11,357.68. The Standard & Poor's
500 Index <.SPX> was up 13.40 points, or 1.11 percent, at
1,219.47. The Nasdaq Composite Index <> was up 24.38
points, or 0.96 percent, at 2,573.81.
Some analysts said Trichet's comment that he never said
what the limit was of the ECB's bond-buying program also helped
the euro bounce off session lows around $1.3060.
The euro <EUR=> was up 0.59 percent at $1.3219, while the
dollar was down against a basket of major currencies, with the
U.S. Dollar Index <.DXY> off 0.65 percent at 80.187.
Matthew Strauss, senior currency strategist at RBC Capital
Markets in Toronto, said Trichet's comments suggest the option
of further bond purchases "is not necessarily off the table at
all."
Bond prices trimmed losses to trade close to break-even.
The benchmark 10-year U.S. Treasury note <US10YT=RR> was flat
at 2.96 percent.
U.S. light sweet crude oil <CLc1> gained 75 cents to $87.50
a barrel, while spot gold prices <XAU=> rose $9.71 to $1,396.40
an ounce.
Earlier in Asia, Japan's Nikkei share average hit a
five-month high, rising 1.8 percent <> to the highest
close since June 22. The MSCI index of Asia Pacific stocks
outside Japan was up 1.7 percent <.MIAPJ0000PUS>.
(Reporting by Gertrude Chavez-Dreyfuss, Wanfeng Zhou, Richard
Leong in New York; Kirsten Donovan, Atul Prakash in London;
Writing by Herbert Lash; Editing by Kenneth Barry)
